SKF Q1 2026: Strong margin despite volatile market conditions

GOTHENBURG, Sweden, April 21, 2026 /PRNewswire/ --

Q1 2026

• Net sales: MSEK 21,873 (23,966).
• Organic growth: 2.4% (-3.5%), driven by organic sales growth within the Industrial segments, offset by negative market demand for the Automotive business.
• Adjusted operating profit: MSEK 2,951 (3,233). Strong positive price/mix contribution, stable cost development and continued significant currency headwinds.
• Adjusted operating margin: 13.5% (13.5%).
• Net cash flow from operating activities: MSEK -446 (977). Mainly driven by restructuring and separation costs and working capital build-up.

Financial overview, MSEK unless otherwise stated	Q1 2026	Q1 2025
Net sales	21,873	23,966
Organic growth, %	2.4	-3.5
Adjusted operating profit	2,951	3,233
Adjusted operating margin, %	13.5	13.5
Operating profit	2,643	2,885
Operating margin, %	12.1	12.0
Adjusted net profit	2,047	2,296
Net profit	1,739	1,948
Net cash flow from operating activities	-446	977
Basic earnings per share	3.57	3.95
Adjusted earnings per share	4.25	4.71

Rickard Gustafson, President and CEO:

"In Q1, we delivered a strong margin despite volatile markets, significant currency headwind and a relatively weak Automotive demand. Our solid performance was due to strong portfolio management and continued cost actions, including rightsizing initiatives. At the same time, we continued to progress our strategic priorities.

Strong margin driven by solid execution

Organic sales growth in the quarter was 2.4%. Bearing Solutions reported positive organic growth, primarily driven by our regions in Asia that more than offset weaker activity levels in Europe. The continued strong organic growth within Specialized Industrial Solutions (SIS) was driven by Aerospace and Magnetic Solutions. This compensated for continued soft demand in Automotive, except for aftermarket products. Price/mix development was solid, mainly driven by tariff-related price increases and stronger aftermarket performance in SIS and Automotive.

The adjusted operating margin at 13.5% was flat, year-over-year, despite a significant currency headwind in the quarter. I am very pleased that we had a higher pace in our rightsizing activities than initially expected. The savings of approximately MSEK 300 compensated for negative separation synergies, where the net effect was slightly positive. For the full year 2026, we expect that rightsizing savings will continue to be somewhat higher than the negative synergies. Additionally, Automotive's margin was solid as we started to see benefits from operating it as a separate and more efficient business. It was also positively impacted by pre-buy effects within the vehicle aftermarket business. Finally, the SIS margin continued to improve, mainly driven by strong growth and positive mix within Aerospace.

Once again, we largely compensated for tariff costs in the quarter, and at current levels, we expect this to also be the case in Q2. Items affecting comparability (IAC) in Q1 amounted to MSEK -300, including a capital gain from the Elgin divestment.

Cash flow from operations was weak at MSEK -446, mainly driven by restructuring and separation costs, working capital build-up due to separation-related safety stocks and high accounts receivable driven by strong sales towards the end of the quarter as well as timing effects in accounts payable.

Continued strategy execution

During the quarter, we continued to execute our strategic priorities, strengthening our position in high-value industrial segments and advancing the separation of our Automotive business.

In the challenging market conditions, our Automotive business has a clear focus on accelerating profitable growth and improving efficiency. The value of new contracts signed over the past year has increased significantly compared to before the separation was announced, supporting future growth and profitability. Our competitive offering, mainly in higher-growth and higher-margin areas, such as electric vehicles and commercial vehicles, is one of the main contributors to the positive momentum. Our aftermarket position has further strengthened through new distribution agreements in key regions. As part of the ongoing Automotive separation, we recently announced the consolidation of our footprint in Americas to strengthen our long-term efficiency and competitiveness.

Outlook

We expect market demand in Q2 to remain at similar levels as in Q1 as a whole. Consequently, we expect organic sales to be relatively unchanged in Q2, year-over-year, against more demanding comparables. However, geopolitical turmoil, including the conflict in the Middle East, amplifies overall uncertainty."

Outlook and guidance

Outlook

• Q2 2026: We expect market demand to remain at similar levels as in Q1 as a whole. Consequently, we expect organic sales to be relatively unchanged year-over-year, against more demanding comparables. However, geopolitical turmoil, including the conflict in the Middle East, amplifies overall uncertainty.

Guidance Q2 2026

• Currency impact on the operating profit: around MSEK -100, year-over-year, based on exchange rates as per 31 March 2026.

Guidance FY 2026

• Tax level excluding effects related to divested businesses and separation of the Automotive business: around 28%.
• Additions to property, plant and equipment: around BSEK 5.
• Items affecting comparability related to the Automotive separation and footprint optimization: BSEK -2.5 to -3. This is within the frame communicated at CMD 2025.

A webcast will be held on 21 April 2026 at 08:30 (CEST):
Sweden: [phone]
UK/International: [phone]

https://www.skf.com/group/investors

Aktiebolaget SKF
(publ)

The financial information in this press release contains inside information that AB SKF is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication through the agency of the contact person set out below on 21 April 2026 at 07.30 CEST.

For further information, please contact:
Press Relations: Carl Bjernstam, [phone]; [phone]; [e-mail]
Investor Relations: Sophie Arnius, [phone]; [phone]; [e-mail]

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The following files are available for download:

https://mb.cision.com/Main/637/4337372/4046898.pdf	Q1_Eng_2026
https://news.cision.com/skf/i/automatic-lubrication-system,c3529929	Automatic lubrication system
https://news.cision.com/skf/i/rickard-gustafson,c3529930	Rickard Gustafson

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